How do cafeteria-style plans increase costs for employers?

A) Employers pay much higher premiums for an HMO than a preferred health care plan.
B) Employers are required to pay higher insurance premiums for laid-off workers.
C) Contributions to PBGC to fund the retirement plan increases under this plan.
D) Employees select the kind of benefits they expect to need the most.
E) Employers bear the cost of providing employees with benefits they do not value.

Cafeteria-style Plans

Flexible employee benefits plans allowing workers to choose from a variety of pre-tax benefits options, similar to selecting food in a cafeteria.

HMO

Health Maintenance Organization, a type of health insurance plan that requires members to access healthcare services from a specific network of providers.

PBGC

Pension Benefit Guaranty Corporation; a federal corporation created to protect the retirement incomes of workers in private-sector defined benefit pension plans in the United States.